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Are restaurant tip pools illegal?

 

A:
Under the Fair Labor Standards Act employers can have tipped employees contribute a portion of their tips into a pool which is split among other employees. However, employers must still meet certain conditions to validate a tip pool including:

  • Employees should contribute only a “customary and reasonable” amount of tips to the pool.
  • Only employees who regularly receive tips can be part of the tip pool. Tip pools cannot include employees who do not customarily receive tips, including cooks, food expeditors, or dishwashers.
  • The employee can't be required to pay any part of the tips the employer is counting towards the minimum wage into a tip pool. 
  • Employers cannot be included in tip pools.
  • The employee’s wages must not fall below minimum wage as a result of contributing to the pool;
If an employer does not meet the above requirements or if an employer does not inform you of their intention to use a tip credit, or involve you in a tip pool, you may have a claim for up to two years in back wages, or three years for a willful violation.

Contact our office today to have one of our Houston wage and overtime attorneys help you with your questions. We represent victims of unfair pay practices throughout Texas and nationwide.




The Texas overtime lawyers at Kennedy Hodges represent workers nationwide and across Texas in:
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